Select Committee on International Development Minutes of Evidence

Attachment 1


  The UK and other member states provide the bulk of EC development assistance in two distinct ways:

    —  Budgetary contributions

    —  Voluntary contributions to the European Development Fund (EDF)


  The EC's external programmes are, with the exception of those for African, Caribbean and Pacific states, funded from the EC budget. Each member state's share is based on a formula that takes account of GDP and customs receipts. Our current share is approximately 19 per cent[14]. With a few exceptions for particular programmes, DFID is responsible for the UK's contributions to the external relations and pre-accession chapters of the budget (known respectively as Categories 4 and 7 of the budget). This accounts at present for just under £700m of DFID's budget. Each year the Treasury withholds the UK's estimated budgetary contribution to the EC on development from DFID's vote. Adjustments are made in following years when the final outturn is known.


  The European Development Fund was established as the financial instrument for the series of agreements signed between the EC and African, Caribbean and Pacific states (the Lomé Conventions and, since June 2000, the Cotonou Agreement). It is a voluntary fund which all member states contribute to and which is managed by the Commission. The EDF is replenished every five years. The size of the replenishment and each member state's share are negotiated afresh on each occasion. For the past two replenishments (EDF 8 and EDF 9), the UK share has been 12.7 per cent. This is paid on a quarterly basis from DFID's accounts. The estimated UK share of EDF expenditure this financial year is £91m. This has reduced from over £200 million two years ago due largely to the opportunity to clear a backlog of unspent resources previously called down from member states.

14   The abatement to UK budget contributions to take account of our relatively lower receipts from the CAP does not apply to the external relations part of the budget. Back

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